This looks good to me, but does anyone see any problems?

[Joshua Nudell]

Good afternoon everyone,

I received an e-mail from a wholesaler in NJ who has a property under contract in East Orange, NJ 07018.  Here are the details:

Duplex multifamily property 2/1 downstairs, 3/1 upstairs.

Currently rented for $1050 down and $1350 up for a total of $2400

Taxes are $8,300

Tenants pay their own utilities (separate meters).

Upstairs is a Section 8 tenant who just got their lease renewed on 7/1.  Their contribution is $116 per month, and they pay their part every month on time.

Updates were done in 2013 including new roof, new kitchens and new laminate flooring.

The wholesaler is asking $107,500.  Tax assessed value is $168,200.  Similar properties are listed at $150,000+.

I was thinking of ordering a quick BPO to get a better idea from a local agent, but I feel it would easily sell for $140,000.

It looks like I would have two good strategies with this one; 1) Purchase all cash, then sell it normally for a small profit, or 2) purchase, and refinance and keep renting it out for rental income.

Anyone have some suggestions or thoughts?

I don't have the full cash purchase price on hand, so I'm also wondering if this would make a good partnership opportunity.

Thanks all!

[Nick C.]

I would look at what properties are selling for, as opposed to what they are listed for and their tax assessed value. 

Bellerose is a long drive from NJ, hopefully you have someone who can get eyes on the inside and get some pictures for you? Even if you have to pay an agent or property manager it'd be worth it. The rents are tempting, and even if the tenants are paying there could be decades of deferred maintenance in there.